Looking at the trends in the used car market, similar problems are experienced in every European country. From fake mileage, hidden damage or an aging fleet that reduces the chances of getting a quality car. The used car market often has serious transparency issues. The severity of the situation is somewhat different across Europe, which can be explained by the economic situation of the countries and regional characteristics.
Car history reporting platform carVertical conducted a study to find out which countries are the riskiest to buy a used car.
How bad is the Latvian used car market?
In the “carVertical” market transparency index, Latvia ranks last among the 23 countries surveyed, indicating a potentially alarming situation in the used car market. The country has a high percentage of damaged cars, which in the long run may force buyers to invest more money in their repair and maintenance.
The average age of inspected cars in Latvia is 11.4 years, making the national car fleet one of the oldest in Europe.
Despite the large number of damaged cars in Latvia, the average value of the damage is surprisingly low – only 2,830 euros. According to research data, Eastern and Central European countries – Hungary, Slovakia, Romania – have much lower average damage values compared to Western Europe, where losses are usually 2 to 3 times higher.
Western countries are more transparent
According to the data of the research, it can be concluded that the used car market in Western Europe is much more transparent than in Eastern Europe. It should come as no surprise to many that most of the cars sold in the East are imported from Germany, France or Italy.
In the Market Transparency Index, the United Kingdom is the most transparent country among the 23 countries examined. But that doesn’t mean that British used cars weren’t damaged. False mileage was found in 14.5% of cases from all cars checked in the country. On the other hand, 21% of cars were damaged at some point, which encourages buyers to distrust sellers completely. However, the UK has the lowest number of imported cars at 10.7%.
Germany ranks second with 12.6% of rolled cars and 21.3% of damaged cars. Although Germany is Europe’s most influential automobile manufacturer, 26.8% of used cars in the country are imported from abroad.
Italy has the lowest number of damaged cars in the index with 16.6%. The number of cars with fake mileage is also quite low – 11%, and only 32.1% of the machines in the country are imported from other countries.
“All these countries are the heavyweights of automobile production. Germany, Italy and France produce a lot of cars and also export and supply used cars to the rest of the region,” says Matas Buzelis, head of communications at carVertical.
The fine for falsifying mileage in France is up to 10 times higher than in some Eastern European countries, leading to a lower number of cars with fake or fake mileage – 9.6%. However, 28.5% of the cars used in traffic are damaged, which is a very significant rate. The country imports 54% of used cars sold there, which is the highest rate among countries posted at the top of the chart.
Transparency in Central Europe – mediocre
Central European countries – Croatia, Czech Republic and Slovakia – rank middle in the Market Transparency Index. These countries have a high rate of imports as well as a large number of damaged cars.
Half of the used cars in the Czech Republic are imported from abroad. 51.6% are defective and 11.4% are fake mileage.
In Slovakia, the neighboring country of the Czech Republic, the proportion of imported machines is even higher – 58.5%. On the other hand, 57.7% of the machines were damaged. But the mileage of one out of nine cars is fake.
The situation in the used car market is quite similar in Hungary. 52.6% of the vehicles are imported, 55% are damaged and 12.7% have fake odometers. Although Croatia has one of the lowest false mileage rates (10.3%), it has a significant number of imported vehicles (69.3%). And 56.4% of the cars are damaged.
Eastern European market suffers biggest transparency problems
Buying a used car in Latvia, Lithuania, Ukraine or Romania is a risky undertaking because many cars have hidden damage, fake mileage and other issues. There is also a widespread scam that many buyers fall into in these countries.
The most suspicious car market is in Latvia, where 23.6% of cars checked by “carVertical” were found to have fake mileage. Data on this issue are similar in other Eastern European countries: 19.6% of cars with false mileage in Romania, Ukraine – 15.6% and Lithuania – 18.1%.
Ukraine is the leader in car imports – more than 80% of cars in the country are imported from abroad. Latvia (75.5%), Romania (67.2%) and Lithuania (75.3%) are not far behind.
In most Eastern European countries, cars are imported damaged, then repaired and sold as new. This is why the number of damaged cars is so high in Eastern Europe. 59% of the cars were damaged in Lithuania, 57.5% in Latvia, 57% in Romania and 46.7% in Ukraine.
“One of the main reasons that Eastern European countries suffer more from fraud is a significantly higher rate of used car imports. Imports directly increase the number of fake kilometers. However, such violations are difficult to detect. Especially if the transaction takes place in different countries,” he explains. Buzelis.
How was the work carried out?
This research is based on data from real reviews of cars purchased by our customers over a 12-month period. Thus, a comprehensive view of the state of used car sales in Europe was obtained, allowing experts to compare the situation in different countries.
In order for the research to be qualitative, “carVertical” created the Market Transparency Index, which consists of 6 data sets:
- percentage of cars with fake mileage;
- average distance in kilometers;
- percentage of damaged cars;
- average damage value;
- proportion of imported used machines;
- average age of tested machines.
Considering that each of these data is not equally important for the representation of market transparency, their proportions in the creation of the index are different. For example, the average odometer rewind section has a greater impact on the final score than the average age of the cars tested.
“By examining historical data from a large number of cars, we can see the common denominators in different markets and track their changes,” explains Buzelis.
Source: Tv Net